Senators pass resolution banning themselves from trading on prediction markets
The Senate unanimously agreed to a resolution Thursday barring its members from trading on prediction markets in the face of growing concerns about insider trading on the platforms.
The resolution, which was introduced by Sen. Bernie Moreno (R-Ohio) last week, amends the chamber’s rules to prohibit senators from entering into “an agreement, contract, or transaction that provides for any purchase, sale, payment or delivery” based on an event’s outcome.
Prediction markets allow people to place wagers on the outcome of various events, from elections to sports to the economy.
“Proud to say my bill to ban members of Congress from insider trading on prediction markets just passed the Senate UNANIMOUSLY!” Moreno wrote on the social platform X. “Serving in Congress is an honor, not a side hustle. Americans deserve to know that their leaders are here for the right reason!”
Two of the most prominent prediction markets, Kalshi and Polymarket, both voiced support for the effort.
“I applaud the Senate for passing this resolution to ban Senators and their offices from trading on prediction markets,” Kalshi CEO Tarek Mansour said on X. “Kalshi already proactively blocks members of congress and enforces against insider trading.”
“This is a great step to increase trust in our markets by making it an industry standard,” he continued. “Now, let’s pass this in the House!”
Polymarket similarly said it is “in full support of this,” while noting that its rules “already prohibit such conduct, but codifying this into law is a step forward for the industry.”
The Senate resolution comes after the Department of Justice (DOJ) revealed last week that it had charged an Army soldier for using confidential information about the operation to capture Venezuelan President Nicolás Maduro in bets on Polymarket.
Gannon Ken Van Dyke, who was involved in the planning of the Maduro raid, allegedly bet $33,000 on various markets related to the military operation and made $400,000 in profits.
Van Dyke appeared in a Manhattan court for his arraignment Tuesday, where he pleaded not guilty to the charges. He faces three counts of violating the Commodity Exchange Act, one count of wire fraud and one count of an unlawful money transaction, which carries a combined maximum sentence of 60 years.
The suspicious trades on the Maduro raid were followed by several other well-timed bets that have drawn scrutiny on prediction markets. Both Kalshi and Polymarket have since rolled out additional restrictions on insider trading.
Sens. Todd Young (R-Ind.) and Elissa Slotkin (D-Mich.) have proposed legislation that would crack down on insider trading on the platforms. Young called Thursday’s resolution a “good first step” and encouraged the House to follow suit.
“At a minimum, we should pass my bill with @SenatorSlotkin to prohibit all federally elected officials and government employees from using insider information to bet on a prediction market contract,” he added in a post on X.
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